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SG meeting FR/UK/IR region 14 June 2007 Congestion management. Marcel Cailliau (Electrabel) User comments supported by EFET and Eurelectric on IFA congestion management proposals from NG and RTE (based on work stream conference 17.04.2007). Content. - PowerPoint PPT Presentation
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SG meeting FR/UK/IR region14 June 2007
Congestion management
Marcel Cailliau (Electrabel)
User comments supported by EFET and Eurelectric on
IFA congestion management proposals from NG and RTE (based on work stream conference 17.04.2007)
Content
• Purpose of this presentation: summary of 17 April workstream meeting– EFET key principles for capacity rights
• UIoSI and intraday for IFA– TSO proposal– View of users
• Firmness of capacity rights IFA– Firmness– ITL
Repartition allocated transmission rights
Current usual practice
100%
66%
33%
1 Y allocation
M + Q allocations
365*24h daily Allocations remaining 33% + seasonal variation
22 % yearly
44% multi year
“Wished” realistic practice
M + Q allocations per year for about 22 %66%
100%
44%
88%
Multi-year and yearly auctions held for proportional shares at different times in year; e.g. 4 auctions of 11% multi-year capacity and 4 auctions of 5.5 % yearly capacity,multi-year products and also Y+1, Y+2, Y+3, .. to be offered separately.
365*24h daily allocations per year 12% + seasonal variations
Seasonal expected commercially available capacity
Source : EFET position paper : Key principles Transmission Rights (June 2006)
Indi
cativ
e %
!
EFET vision linkage LT/secondary market/short term transmission rights
Monthly/Quarterly Intraday market20082010 2009 AnnualC
apac
ity
H-15
Capacity used OTC
Time
Periodic capacity salesharmonised withenergy market
Use or sell (give up) capacity to
PX
Options tradable in secondary market
Obligationstradable in
Intra-day market
H+30
Intradaymarket starts
Daily
“extra”
Use it
Capacity used
implicitly
H
Multi-Annual
Sell it
(get paid for it)
H
D-1 implicit allocation
Capacity allocation at D-1: Market coupling linked to explicit auctions
Source : EFET position paper : Key principles Transmission Rights (June 2006)
Context – CM Guidelines• Congestion Management Guidelines came into force in December
2006
• These Guidelines are annexed to 2003/1228 Regulation and have a compulsory status
• IFA is not fully compliant with these Guidelines. Evolutions are required on:– Reserve Price - done– UIOLI/UIOSI– Intraday allocation mechanism– Firmness of capacity
• The current IFA process is as follows:
D-1 DJD-n
CAR NoticeDeclaration
LT + D-1Nomination
D-1Auction
Periodical(LT) Auction
LT + D-1ICEs
IntraDayRe-nominations
CurrentUIOLI
SecondaryMarket
Current Process
Source : IFA user workshop 28 03 2007 RTE-NG, London
IntradayRedeclarations
Hourly blocs
ICE
D-1 DD-n
Periodical (LT)Auction
24h blocs
MCN
06:45
LT FirmDeclarationHourly blocs
07:45
D-1Auction
24h blocsPAY as CLEARED
Min(ICE)
Max(MCN)
UIOSI
D-1NominationHourly blocs
13:00
D-1 ICEs
Secondary Trading(Reassignment) 05:15
LT ICEs
06:15
Proposed Interim Process
Source : IFA user workshop 28 03 2007 RTE-NG, London
ICE
D-1 DD-n
Periodical (LT)Auction
24h blocs
MCN
06:45
LT FirmDeclarationHourly blocs
07:45
Min(ICE)
Max(MCN)
Secondary Trading(Reassignment) 05:15
LT ICEs
06:15
Proposed Interim Process : comment
Source : IFA user workshop 28 03 2007 RTE-NG, London
Whenever at 1 hour all LT
capacity is used, there isn’t any UIoSI 24h bloc
UIOSI
?
IntradayRedeclarations
Hourly blocs
ICE
D-1 DD-n
Periodical (LT)Auction
24h blocs
MCN
06:45
LT FirmDeclarationHourly blocs
D-1Auction of24h blocs
PAY AS CLEARED
Min(ICE)
Max(MCN)
D-1NominationHourly blocs
+ UIoLI (if intraday pro rata or ELBAS)
OR+ UIoSI
(if intraday auction)13:00
D-1 ICEsNETTING LT!
Secondary Trading(Reassignment) 05:15
LT ICEs
06:15
Requested Interim Process (17 04 07)
Could be D-2 16:00 (ph 1)
IntradayAllocation ofHourly blocs
LT ICEs :not necessary if firm rights
UIOSI
07:45
D-1AuctionHourlyOffered
PAY AS CLEARED
Source : EFET position paper : Cross-Border Intraday
IntradayAllocation ofHourly blocs
D-1 DD-n
Periodical (LT)Auction
24h blocs
06:45
LT FirmDeclarationHourly blocs
D-1NominationHourly blocs
+ UIoLIOR
+UIoSI
13:00
D-1 ICEsNETTING LT!
Secondary Trading(Reassignment) 05:15
Requested Interim Process (final) (17 04
07)
LT ICEs :not necessary if firm rights
UIOSI
07:45
D-1AuctionHourlyOffered
PAY AS CLEARED
National Grid/RTE proposalIn order to ensure full compliance with CM Guidelines, National Grid
and RTE jointly propose the following action plan:
• September 2007 creation of a LT gate-closure and implementation of a UIOSI on 24hrs bands of capacity
• Mid 2008 implementation of an intraday interim allocation and nomination mechanism (possibly auctions)
• End 2008 improvement of the LT/D-1 mechanism (target mechanism, auction platform, hourly process)
• In 2009 implementation of an advanced intraday continuous allocation and nomination mechanism (intraday capacity platform), if its opportunity and feasibility are confirmed.
Proposal market players• Market players see the following project steps• January 2008 :
– UIoSI on hourly basis– Day ahead auctioning for 24 hours separate products
• For a fast implementation, users give preference to ARIBA platform • CWE (pentalateral forum): common auction office under preparation by 2009
– Concurrently, intraday model based on the current implementation on other French borders (improved pro rata on BE,GE,CH border or explicit auctions on ES border)
– Secondary market model in line with other FR borders, to be further improved in a later phase
• As soon as possible, launch of an “ELBAS” look alike intraday model
• Do not re-invent the wheel! Harmonise! – Consider also ongoing harmonisation work by ETSO (ECAN)
Conclusions 17 April workshop
• TSO menu of options expected within 3 weeks: – Costs, resources needed,..– Benefits– Implementation schedule
• 1 week stakeholder consultation process• Status on 14 June 2007?
Firmness/ITL• EDFT evaluation (2006):
– ITL loss of market value: 17.75M€– Lost market value due to target availability: 14.6M€
• CRE analysis (12.05.2007) FR/SP border : congestion income of 52 M€, curtailments paid at full market spread (PX) = 3 M€.
• User point of view:– Transparency ITL needed– Reimbursement of any curtailment at market spread
• Regulator point of view:– Offering of different products (firm, less-firm (?)) at different prices– Transparency ITL calculation needed (and not compliant CM
guidelines!)